Singapore manufacturing and service sectors slightly more upbeat about business prospects

SINGAPORE - Companies in both the manufacturing and service industries here were slightly more optimistic about business prospects for April to September, according to the findings of separate surveys by the Economic Development Board (EDB) and Department of Statistics (DOS), released on Thursday.

EDB, which surveyed manufacturers, found that a net weighted balance of 5 per cent of firms expect business to improve over the next six months compared to the findings of its survey done three months ago. A weighted 13 per cent said they expect business to improve, while 8 per cent expect business to deteriorate.

The DOS said a net weighted balance of 3 per cent of firms in the service sector are optimistic about business prospects, with the financial and insurance, information and communications, and transport and storage industries particularly upbeat.

Within the manufacturing sector, the electronics cluster was the most optimistic with a net weighted balance of 19 per cent of firms anticipating improved business conditions in the next six months. On the flip side, the transport engineering cluster was the least optimistic, largely due to the marine and offshore engineering segment anticipating weaker orders due to a slowdown in offshore exploration and drilling activities on the back of low oil prices.

For the service sector, the net weighted balance of 3 per cent of firms expecting better business conditions for April to September was a turnaround from the -4 per cent from the previous survey three months ago. But the figure was still lower than the 5 per cent from the same period a year ago.

The real estate industry was the gloomiest in outlook with a net weighted balance of 17 per cent of firms expecting the business situation to deteriorate. Developers cited the series of Government measures, including the Additional Buyer's Stamp Duty and the Total Debt Servicing Ratio framework, as the reasons for their negative outlook.

In contrast, a weighted 21 per cent of firms in the financial and insurance services industry are optimistic about the next half-year. In particular, banks and finance companies expect more demand for their services.